Why After The Event Insurance Is Worth Taking Out

After the Event (ATE) insurance can be taken out to cover legal costs and expenses in any litigation or claim dispute. In this article, we look at how ATE is used in personal injury compensation, and how such cover provides a safety net to people looking to make a claim.

Claimants can be charged various solicitor or defendant costs if their claim fails. Therefore, having suitable ATE insurance cover in place can guarantee that you pay no cost whatsoever to any party if your claim fails, and as the cost of any ATE premium is only paid if you win your claim, taking out such cover is a no-brainer.

When should ATE insurance be purchased?

As the name suggests, ATE insurance is purchased after an accident has happened and when a claim for personal injury compensation begins. Taking out an ATE insurance policy will guarantee that the claimant never has the personal responsibility of having to pay costs should their claim fail to succeed.

Your ATE cover requirements will be identified by our specialist solicitors at the outset of your claim. This will happen when the solicitor agrees that you have a viable claim that should be pursued. They may advise that you have no requirement to purchase ATE cover if you already have existing Before the Event (BTE) or Legal Expenses Insurance (LEI) cover in place.

Such cover can often be found attached to home and contents insurance, motor insurance, trade union membership and financial products such as credit cards and loans. Where possible, you can use any cover that you already have in place. In cases where there is no existing BTE or LEI, our solicitors will recommend a suitable ATE insurance policy for your claim.

Who pays the cost and when?

Simply put, you only pay for ATE insurance if and when you win your claim. At the outset of a claim, it is the solicitor who will purchase an ATE insurance policy on behalf of the claimant if they do not already have a suitable alternative BTE or LEI cover in place.

With Direct2Compensation, no claimant pays any upfront cost for ATE insurance cover and nor will they have to pay if their claim fails to succeed.

As a result of the LASPO Act 2012, successful claimants who win their claim for personal injury compensation can no longer charge the cost of their ATE premium to the losing side. Instead, it is deducted from any settlement awarded when a claim succeeds.

How much does ATE cover cost?

As the vast majority of ATE insurance cover will be obtained at the outset of the claims process, standard policies with various cover are available for different types of personal injury claims. Whilst each case needs to be decided on merit, our specialist solicitors can usually identify what level of cover your are likely to require when they first discuss your claim with you.

The level of cover required will vary depending on the kind of claim you are wishing to pursue. In less risky claims, such as a straightforward road traffic accidents where you are unlikely to lose, your solicitor may even recommend not taking out ATE insurance at all. However, if they do, premiums for such cover can start at around £100. In more risky claims, cover can become more expensive as the likelihood of the claim failing increases. In such cases, ATE premiums can be as little as £250, but as much as £440.

Remember, you will never have to pay any upfront cost for ATE insurance cover if your solicitor recommends you require it. With Direct2Compensation, any deductions from your settlement are minimised and as such, the most cost effective policy for your personal injury claim will be purchased. In cases where ATE premiums are higher, the potential compensation settlement awarded is likely to be far higher as well. Therefore, the ATE premium will only form a small percentage of your entire settlement and represent good value for money.

About Ian Morris

I've been involved in the management of personal injury claims for nearly 20 years. Outside of work, I'm married with 2 beautiful daughters. I love surfing, snowboarding and spending time with my family. You can find me on Twitter.

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Questions & Answers

Nicholas Craig 16th May 2020 at 2:29 am

Hello,

I’m considering contesting a will in Northern Ireland. I currently have no legal insurance. Can I get after the event insurance to contest a will? How much will it cost. Do any solicitors in Northern Ireland accept this?

Unfortunately, this is not a situation we can assist you with. Due to the legal system of the United Kingdom, any matters relating to Northern Ireland must be dealt with under the legal system of Northern Ireland and by specialists able to work in said jurisdiction.

The fee you quote is within the ‘acceptable’ price range. However, you are right to consider whether you really need ATE insurance. More and more, our Solicitors are advising claimants AGAINST taking ATE cover as the cost is not recoverable and the reality is that it is not a cost burden that has any real worth in the majority of cases.

Thank you for your reply Ian. It’s already been admitted liability from the other driver, and I wouldn’t think Carpenters would have taken this on as a no win no fee if there was a chance we won’t win. Just seems money grabbing to me?

Hi I am about to start court proceedings against my neighbour over right of way access. My deeds say I have right of way and it is marked on the title plan. My solicitor says we have an 80-90% chance of success. We don’t have legal insurance, we can cover the cost of the first hearing but if it goes to full trial we will not be able to cover the cost. My question is; if it goes to full trial can I take out ATE insurance against costs of the full trial or if I need it at the beginning can I change the cover amount after the first hearing?

Whether or not ATE cover is available for the legal action you are taking is something you should discuss with your Solicitor. As with any insurance, it is usually possible to amend a policy, but you would have to take in to account potential costs as and when the risks of increased liability become apparent.

I was thinking to get a life insurance with a company, if I get that insurance will this be ok as an ATE or is it better to get the ATe insurance suggested by the solicitors and if I agree to get the ATE insurance will this be only for the case or is it going to be something to pay every month?

My wife is looking to make a claim for medical negligence. She is a registered nurse and pays a monthly subscription to Unite union . Would you know if this membership is likely to have any legal cover ? To avoid having to purchase ate insurance?

I have been involved in what seems like a straight forward road traffic accident. The 3rd party are not responding to any correspondence from my insurance so we are moving forward with legal proceedings. How much would ATE cost? My insurance have sourced a quote for me with Legal & General but I would like other quotes.

It isn’t possible to give an exact quote as we do not directly sell such policies. Our Solicitors can provide such cover for cases that they have evaluated in full and decided that such cover would be required. However, in cases such as yours ATE premiums would typically be in the range £130 – £250 or thereabouts.

I am currently in the process of suing a care home after my mother has developed bed sores.

She is looking to receive £8000 compensation but the company no win no fee want to take out an Ate costing £3200 to taken from the settlement fee plus their costs, it seems rather expensive and wondered whether she’s being overcharged?

It is impossible for us to say whether or not the ATE premium is excessive, but it is certainly a very high premium and should be queried. Claimants cannot recover the cost of ATE premiums on success of a claim (this changed post 1st April 2013), so if your Mother’s claim is successful, she will have to repay the premium as well as the 25% deduction. Clearly, such a fee would have a big impact on the settlement she would receive. Whilst she would pay nothing if the claim were to fail, the amount being quoted for ATE cover needs to be questioned and explained in full.

If have been made an offer of a settlement fee as the defendants have admitted liability in writing therefore I am guaranteed to have a successful case. Do you think it is necessary to agree to an ATE?

You seem to have completely misunderstood! We offer a 100% No Win No Fee service. Our clients PAY NOTHING WHATSOEVER to any party should their claim fail – No Win = No Fee! Simple as that.

And then on 15th October you wrote…

If a claimant doesn’t have pre-existing BTE (before the event) cover, it is important for them to put suitable ATE (after the event) cover in place. This cover protects the claimant from having to pay the costs of the defendant if they lose their claim. This cover has always been in place in claims for personal injury compensation.

This completely contradicts what you said about no win no fee!

so what is it? no win no fee = no costs what so ever, or is it, no win no fee ( oh btw you do need to pay for an ATE unless you have BTE) ?

No, it’s as we’ve already said – if you don’t succeed with your claim (don’t win), you pay nothing whatsoever! All claimants need to ensure that they adequate ‘cover’ for defendants fees should they ‘lose’ their claim. This is why our Solicitors will ensure that if a claimant doesn’t already have existing legal expenses cover in place (BTE insurance) that they’ll provide them with suitable ATE cover. If the claim is lost, the claimant does not pay the cost of the ATE premium – the Solicitor covers that cost. However, should the claim succeed, the law prevents the claimant from recovering their ATE premium so they must then pay it from their compensation settlement. So yes, it is no win, no fee – no costs whatsoever.

If a claimant doesn’t have pre-existing BTE (before the event) cover, it is important for them to put suitable ATE (after the event) cover in place. This cover protects the claimant from having to pay the costs of the defendant if they lose their claim. This cover has always been in place in claims for personal injury compensation.

It has always been the case that a claimant would not pay for the premium if ATE insurance cover was put in place by their Solicitor if they were to lose their claim. Prior to 1st April 2013, it was the case that a claimant could recover the full cost of their ATE premium from the defendant on top of and separately to their compensation settlement. However, the Government outlawed this right and claimants can no longer recover their ATE premium cost and must now pay for it from their settlement should they succeed. It remains the case that if the claim is unsuccessful, the claimant will not pay the cost of the premium – the liability for that cost would rest with the Solicitor providing the cover.

No win No fee, i’ll repeat, no win no fee…… so where has all this scare mongering about ATE insurance come from? Praying on people’s fears of having a large bill to pay if they lose. Surely as a solicitor, if you advertise a ‘ no win, no fee’ service, the client should not have to pay a penny to anybody if they lose their claim!

You seem to have completely misunderstood! We offer a 100% No Win No Fee service. Our clients PAY NOTHING WHATSOEVER to any party should their claim fail – No Win = No Fee! Simple as that.

However, as per the regulatory framework in which we operate and in keeping with the legal requirements facing claimants making claims for compensation, should a claimant succeed in their claim, they are obliged to contribute up to 25% of their compensation settlement towards the costs of the claims process, with the remaining costs payable by a losing defendant as well as them paying the claimant their compensation. Also, as the law now prevents successful claimants from recovering the costs of any ATE premium if they succeed with their claim, they must also pay for that IF THEY WIN separately to the 25% deduction.

Hello I am at present making a claim for a fall i had at Eddie Stobards.I have a no win no fee claim and i have been advised to take out AGI insurance.Please can you advise me if you can do this for me and what the cost will be.

We do not sell or provide any insurance policy, although our specialist Solicitors who act for our claimants can obtain such cover if it is needed by the claimant. Such policies can be provided by your Solicitor and you should liaise with them and also check whether or not you have existing cover in place.

I submitted my claim to the money claim court, one of the headings is personal injury ( I had suffered from moderate – serve anxiety & depression, and moderate – serve stress related disease – Coltis as a consequence of the defendant’s professional negligence).

The defendant filed an application to strike out my claim and they requested that application to be handled at a two hours hearing. The outcome is that I will have to revise my particulars of claim and the defendant’s application is stayed… I do not have a solicitor or barrister acting on my behalf and now have realised that I would need to cover the Defendant’s costs if I lost my claim.

I am questioning now, if i actually needed after the event ins, as my bad fall inside Tesco store, was not going to be contested. There was CCTV, and the fall was never in question or doubted. My point is, with 25% solicitors fees and the after the event policy, i ended up, with £ 960, less, out of my £ 1969.00 compensation. It seems a bit steep to me, especially when the fall was indeed caught on camera inside Tesco store.

Whether or not you needed the ATE cover is something that you may obviously consider now that you have succeeded with your claim. However the risk of not having it in place – even in a claim that seems certain to succeed – should a claim fail is why we all take the various insurance covers that we have.

All of us working as professionals within the claims sector would recommend that it is always wise to ensure that you take ATE cover if you don’t already have pre-existing LEI or BTE cover in place as we have all seen claims that we would be our mortgages on succeeding, fail in a hearing. You can never be certain and the possible costs of not having cover do not bear thinking about.

Personal injury – dog attack 17/1/2017. On 27 January I asked about ATE / LEI before signing a conditional fee agreement. This is what I was advised:

One of the reasons the cost rules changed was to try and limit the need for these policies and it seems to have worked in that respect. Personally I do not think they are necessary especially in relation to a claim such as yours but like any insurance policy it is very much down to how risk adverse an individual is, so it is a personal decision whether or not it is taken out. The costs varies depending on the cover you want. If you wish I can make some enquiries and pass you the details of some brokers who will be able to advise you further.

Fast forward – 27/7/2019 the case could proceed to court. I do feel underrepresented and mislead and quite honestly was totally relying on the legal representative’s expertise. I posed the question again about ATE – LEI on 1 July 2019 and wasn’t given a direct answer but told that I wouldn’t be liable to pay anything if the case is unsuccessful. What if it’s successful? Please advise. I do not want to be presented with a huge bill at the end of the day and furthermore following the attack I have spiralled into debt with a notice of seeking possession of the house issued a month ago.

Your Solicitor is right in that if you were to lose your claim, you would bear no responsibility towards the costs of the claim (either yours or the defendants) in any way. However, as ATE insurance premium costs are non-recoverable on success (meaning you cannot force the defendant to reimburse you) in a claim, you would have to pay the cost of the cover if the claim were to succeed. It is unlikely that you would face a huge bill, as most ATE insurance premiums in matters relating to personal injury range between £150 – £300, with some going up to £450. Your Solicitor should be able to advise you of the cost of the policy that was placed on your claim.

It would appear that your claim is still looking positive though. Your Solicitor would not take the matter to court if they felt that there were no prospects of succeeding, so good luck!

I should have asked these questions previously! On a no win no claim will I be responsible for paying the solicitors disbursements, VAT and success fee? Can I request a breakdown of disbursements? His fees are currently £10k excluding disbursements, VAT and success fee, is £10k paid by the defendant? I do not want any surprises at the end of this nightmare… Lastly, the table of fee earners fees scheduled as part of the Conditional Fee Agreement has changed from the outset and I was not given prior written notice. All fees have increased by £50.

Ian Morris 30th August 2019 at 5:19 pm

Without knowing the details of the agreement you have signed with your Solicitor, I am assuming that it is a standard conditional fee agreement. If so, you will pay no more than 25% of your settlement towards the costs of the claim with the remaining costs (apart from any ATE premium that you may have responsibility for) being problems for others!

You do not have to take out ATE insurance, but if your Solicitor is advising you to make sure that you are covered, it would be wise to take that advice. ATE cover simply ensures that you will not have to pay the costs of the defendant should you fail to succeed with your claim.

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44 questions on this article

May I take this opportunity to thank you for making this process so easy for us and for your help to date.

Julie-A, Dorset

After suffering from a slip resulting in a broken leg, having never been in this situation, I was confused, anxious and not sure what I should do with regards to claiming compensation for loss of earnings. The internet is a minefield of varying advise and companies all offering their services and a lot was jargon and unclear. The wording and explanations on the site given by Ian Morris was clear, concise and in plain English. I requested a call back and Ian promptly called me to discuss my case. He was patient and knowledgeable and I felt comfortable talking to him, feeling that he understood my concerns. I would thoroughly recommend anyone who needs to make a personal injury claim to talk to Ian Morris to help point them in the right direction in order to move forward to making a claim.

EL, Surrey

Clear, concise and helpful support – thoroughly recommended!

If I were ever in this situation again, which hopefully I won’t be, I would definitely contact you again for advice & help. In the meantime, continue being the kind, honest and considerate company that you are. It’s a been a pleasure dealing with you.

Mrs. L. C – Southport

Hi, thanks for the update.

I have no further requirements, I am very happy with the service that was provided.